Belgian Supreme Court broadens social security contribution risk for parent company benefits

At a glance

• The Belgian Supreme Court ruled on 29 June 2026 that benefits granted by a parent company may constitute remuneration subject to Belgian social security contributions where they are linked to an employee's work performance.
• The decision departs from the long-standing view that benefits provided directly by a parent company, without cost recharge to the Belgian employer, generally fall outside the social security contribution base.
• Employers may face claims for unpaid employer and employee social security contributions, interest, and potential surcharges where similar arrangements are in place.
• The judgment may also affect holiday pay calculations, as benefits included in the social security contribution base are generally included in the holiday pay calculation base.
• Multinational groups should review equity and other parent company-sponsored incentive arrangements to assess potential Belgian social security and employment law risks.

The Belgian Supreme Court has issued a significant judgment that may broaden the circumstances in which benefits granted by a parent company to employees of a Belgian subsidiary are subject to Belgian social security contributions.

Historically, employers often relied on the view that benefits provided directly by a parent company, particularly equity-based incentives, were not subject to Belgian social security contributions where the Belgian employer neither funded nor administered the benefit. This position was based on the requirement under Belgian legislation that remuneration must be provided 'at the expense of the employer' to fall within the social security contribution base.

The Belgian National Office for Social Security (NOSS) has increasingly challenged this interpretation. In a judgment dated 29 June 2026, the Supreme Court endorsed a broader approach by focusing on whether the benefit constitutes a counterpart for work performed under the employment contract.

The dispute arose from a parent company benefit granted to employees of a Belgian subsidiary. Earlier proceedings resulted in the Belgian Employment Appeal Tribunals finding that the benefits were not subject to social security contributions. However, following two appeals, the Supreme Court concluded that remuneration should be understood as the consideration for work performed by the employee under the employment relationship.

In reaching its decision, the Court attached particular importance to the fact that employee performance assessments played a role in the employer's decision to grant the benefit. As a result, it found that the lower court had incorrectly excluded the benefit from the concept of remuneration and annulled the judgment, referring the case to the Employment Appeal Tribunal of Brussels.

Although Belgian law does not operate under a strict system of binding precedent, the decision is likely to strengthen the NOSS's position when challenging similar arrangements. Where benefits granted by a parent company are linked to employee performance or employment-related objectives, the authorities may seek payment of outstanding social security contributions from the Belgian employer. These claims could include employer contributions, employee contributions, interest for late payment, and potential penalties.

The judgment also has implications beyond social security law. Benefits excluded from the social security contribution base are generally excluded from the holiday pay calculation base. Consequently, if a parent company benefit is regarded as remuneration for social security purposes, employers may also face additional holiday pay liabilities.

Multinational groups that operate parent company-sponsored share plans, incentive schemes, or other benefits for employees in Belgium should consider reviewing their arrangements. In particular, employers should assess whether eligibility criteria, performance conditions, or related communications could indicate that the benefit is linked to the employee's work performance, thereby increasing the risk that it will be classified as remuneration.

Employers should note, however, that the judgment does not affect the specific regime under the Belgian Act of 26 March 1999. Stock options that fall within the scope of that legislation remain expressly exempt from Belgian social security contributions and, consequently, from related holiday pay obligations.